Homegrown food giant Jollibee Foods Corp. (JFC) is forming a joint venture with Singaporean firm Dim Sum Pte. Ltd. (DSPL) to invest up to $13 million for the franchise of dim sum restaurant chain Tim Ho Wan in the People’s Republic in China.
Listed JFC said the deal will be executed between JFC’s wholly-owned unit Golden Plate Pte. Ltd. (GPPL) and DSPL with the former to hold 60 percent of the business. DSPL, the Titan Dininga Holdings Pte. Ltd. unit whose primary activity includes owning and operating Tim Ho Wan restaurants in Singapore, will account for the balance.
“GPPL and DSPL have committed to invest up to $13 million to the JV, of which up to $7.8 million will be contributed by GPPL in proportion to its ownership in the business. The JV shall have its own resources and personnel to operate and manage the business,” JFC said in a disclosure to the stock exchange on Thursday.
Following its incorporation, the JC company will be signing a unit franchise agreement with Tim Ho Wan Asia-Pacific master franchisor Tim Ho Wan Pte. Ltd. for the development and operation of the brand’s stores in Shanghai and other cities.
JFC said Tim Ho Wan is set to serve as its fourth brand serving Chinese cuisine, after Chowking, Yonghe King and Hong Zhuang Yuan. The three earlier brands combined account for about 20 percent of JFC’s systemwide sales.
Earlier in the year, JFC also announced its acquisition of USA-based The Coffee Bean & Tea Leaf, which had 1,174 outlets as of end-September. This addition brings the JFC group’s total footprint to 5,863 stores nationwide.
JFC booked 34.4 percent lower net income in the first half of the year, to P2.6 billion from P4.050 billion in the same period in 2018 due to manufacturing expenses, Red Ribbon’s plant transition and losses from its recently-acquired burger chain, Smashburger.